Argentina’s consumer prices rose 2.05% in July, according to the Institute of Statistics and Social and Economic Trends (IETSE), interrupting the gradual disinflation observed in previous months. The figure, which brings year-to-date inflation to 19.3% and the annual rate to 33.8%, aligns with a cluster of private estimates that placed the monthly increase between 1.9% and 2.1%. Consultancies including EcoGo and Fundación Libertad y Progreso projected 2.1%, while Econviews and CyT Asesores calculated 2% and 1.9% respectively; only Equilibra foresaw a further deceleration to 1.8%.

The acceleration was led by housing, water, electricity and gas, which climbed 2.5%, followed by recreation and culture (2.4%) and transport (2.2%). Food and non-alcoholic beverages, the heaviest category in the consumption basket, rose 1.9%, with sharp increases in pasta and dairy (6%), oils (5%), and flour, sugar and yerba mate (4% each). Analysts attributed the pressure to the seasonal effect of winter holidays on tourism and airfares, a modest rebound in vegetable and meat prices, and the pass-through of a 6% depreciation in the wholesale exchange rate since May. Clothing prices, by contrast, fell as winter sales began.

The cost-of-living squeeze intensified for households. The IETSE report found that a typical family needed 1,997,833 pesos to cover the Total Basic Basket and avoid poverty, and 1,090,624 pesos for the Food Basic Basket to stay above indigence. Some 57.1% of homes could not adequately cover the food basket in July, and 76.1% of families perceived a deterioration in their diet compared to a year earlier. Within households, 38.3% of adults reduced their own portions to prioritise others, and in 27.8% of homes with minors, a child had to eat less for lack of money. To cope, 88.5% of families financed food purchases, with 39.3% relying on store credit and 37.9% on credit cards. The strain also hit neighbourhood retailers: sales at proximity food stores fell 8.3% year-on-year, and 12.5% of shopkeepers judged their business unsustainable within six months if current conditions persist.

The official INDEC consumer price index for July is scheduled for release on 13 August. Several private analysts expect the seasonal factors to fade and inflation to resume a downward trajectory, potentially slipping back below 2% monthly in the second half of the year. However, a University Torcuato Di Tella survey showed that consumer inflation expectations for the next twelve months jumped to 35.8%, up from 32.1% in June, signalling that households remain wary of the price outlook.